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DECISION No

DECISION No. 41/1999/QD-TTg OF MARCH 8, 1999, PROMULGATING THE REGULATION ON SAFETY CONTROL IN PETROLEUM ACTIVITIES

THE PRIME MINISTER

Pursuant to the Law on Organization of the Government of September 30, 1992;

Pursuant to the Labor Code of June 23, 1994;

Pursuant to the Petroleum Law of July 6, 1993;

Pursuant to the Law on Environmental Protection of December 27, 1993;

Pursuant to Decree No. 84/CP of December 17, 1996 of the Government detailing the implementation of the Petroleum Law,

DECIDES:

Article 1.- To promulgate together with this Decision the Regulation on safety control in petroleum activities.

Article 2.- This Decision takes effect 15 days after its signing. All previous provisions contrary to this Decision are now annulled.

Article 3.- The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the People�s Committees of the provinces and centrally-run cities and heads of concerned bodies, the Managing Board chairman and the general director of Vietnam Petroleum Corporation shall have to implement this Decision.

For the Prime Minister

Deputy Prime Minister
NGO XUAN LOC

REGULATION ON SAFETY CONTROL IN PETROLEUM ACTIVITIES

(Issued together with Decision No. 41/1999/QD-TTg of March 8, 1999 of the Prime Minister)

Chapter I

GENERAL PROVISIONS

Article 1.- Purposes

This Regulation prescribes the implementation of the Petroleum Law of July 6, 1993, the Labor Code of June 23, 1994 and other legal documents relating to safety control in the oil and gas industry.

Article 2.- Objets and scope of application

This Regulation shall apply to petroleum activities, including prospection, exploration, field development, oil and gas exploitation, storage, and transport; oil refinery, oil and gas processing, oil and gas products distribution as well as technical services related to these activities, which are conducted within the territory, exclusive economic zones and continental shelf of the Socialist Republic of Vietnam.

This Regulation shall also apply to projects, pineline systems, accompanied equipment and vessels used in service of the above-mentioned activities.

Article 3.- Terms used herein

In this Regulation, the following terms are construed as follows:

"Safety work" is the adoption of executive and technical measures to protect human beings, environment and property.

"Project" is a complex involving equipment and structures built fixedly or temporarily on land or offshore to service the petroleum activities.

"Competent bodies" are State agencies, including the agencies performing the State management over petroleum; the Ministry of Labor, War Invalids and Social Affairs; the Health Ministry; the Ministry of Public Security, the Ministry of Science, Technology and Environment, the People�s Committees of the provinces and centrally-run cities and other agencies prescribed by law or authorized by the Government.

"Risk evaluation" is the evaluation of potential risks, and at the same time the determination of measures to minimize risks to the reasonable extent possible.

"The operator" is an organization or individual that is allowed to carry out petroleum activities and designated as an executive company to participate, on behalf of parties or other contractors, in a project.

"Risk analysis" is the analysis, determination and systematic classification of risks for human beings, environment and property.

"Risk" is a possibility where incidents and/or accidents may occur with their consequences.

"Incidents" are all unintended occurrences which may cause accidents.

"Accidents" are unintended occurrences which cause damage to human health or casualties, to property, factories, products or environment; and/or disrupt production.

Article 4.- Submitting documents

When applying for license to invest in petroleum projects, organizations and individuals shall have to justify their safety control capability and commitments to ensure safety during the course of project execution.

Organizations and individuals that conduct petroleum activities are obliged to prepare then submit to the Vietnam Petroleum Corporation for consideration and for approval by the competent bodies the following documents:

- The safety control program;

- The report on risks evaluation;

- The emergency rescue plan.

These documents shall be submitted before conducting oil and gas prospection and exploration, field development, oil and gas exploitation, building new oil and gas projects, modifying oil and gas projects, making cancellation and cleaning upon the termination of exploitation or conclusion of the project.

Article 5.- Required contents of the documents

1. The safety control program must at least include the following contents:

- The safety policy and objectives;

- The safety control organization, description of levels responsible for the safety work;

- The program for training of laborers in safety, their capabilities and experiences;

- The safety standards and regulations to be applied in the process of activities.

2. The risk evaluation report must at least include the following contents:

- The determination of the purposes and objectives of the risk evaluation;

- Description of activities and works under the project;

- The adopted risk norms;

- Determination, analysis and evaluation of risks;

- Measures to minimize risks.

3. The emergency rescue plan must be proper for its coordination with the national plan thereon, and must at least cover the following contents:

- The plan of organization, responsibility division, individuals� responsibilities, the reporting system in cases of accidents or dangerous circumstances;

- The plan of contacts with and reporting to competent bodies;

- Description of internal and external resources available or to be mobilized for effectively coping with emergencies.

The competent bodies may request the operators to cooperate with one another in order to work out a common plan against emergencies.

Chapter II

OBLIGATIONS OF OPERATORS AND LABORERS

Article 6.- Obligations of operators

The operators shall ensure that all activities must be conducted safely and in compliance with the provisions of this Regulation, including cases where they perform the work for other operators that are contractors or subcontractors.

Article 7.- Obligations of laborers

While working, the laborers shall have to abide by the regulations and process on safety and working environment so as to protect the health and safety of their own and of others as well as to protect equipment and machinery at workplaces.

Article 8.- The safety control system

The operators shall have to establish, maintain and develop the safety control systems so as to ensure that all activities are planned, organized, carried out and maintained according to the provisions of this Regulation and other provisions of law.

The safety control systems must ensure the effective control of risks throughout the course of operation from the stage of designing to the stage of construction, test-run, commissioning and cancellation of projects.

The safety control systems must be systematically and constantly updated. All updated information must be notified to the competent bodies and disseminated to the relevant laborers.

The safety control system must be indicated in writing with the following main contents:

- The determination of objectives in the field of safety and working environment for petroleum activities;

- The list of relevant up-to-date regulations of the State;

- The concrete requirements for the implementation of the State�s regulations in the field of safety and working environment;

- The justification of the organization of petroleum activities, including reporting channels, responsibilities, assignment of management, task performance;

- The justification of the demand for personnel and their working capacity;

- The justification of documentation and information system;

- Regulations and guidances for making activities conform to the set objectives;

- Regulations on inspection and evaluation of projects;

- Regulations on evaluation of work performance and handling of cases of failure to meet the requirements of competent bodies as well internal requirements.

Article 9.- Risk control

The operators shall ensure that all potential risks must be determined, analyzed and evaluated for all projects and accompanied equipment and for activities at all stages of petroleum operation. Basing themselves on these outcomes, the operators shall have to deploy measures in order to minimize and control risks and to prove that the risks are acceptable.

All reports on risk analysis and evaluation must be updated according to operation process so as to create basis for making decisions relating to safety in petroleum activities.

The operators shall have to determine locations and specific operating conditions, to which safety should be attached to when conducting activities.

Article 10.- Safety and working environment

The operators must provide the laborers fully with safety means, ensure the labor safety and hygiene and improve the working conditions systematically.

The work places must meet either Vietnamese standards or international standards on working environment, which have been approved by the competent bodies in order to protect the laborers� health and ensure their safety.

Article 11.- Drawing up plans of working environment

The operators shall have to examine and make plans of working environment according to laborers� health status and working conditions regularly or when there appear any changes in the working method or conditions. The working environment plans must be always kept at the work place. Any changes in the working conditions should be publicized among laborers.

Article 12.- Monitoring laborers� health

The operators shall have to ensure that all laborers are given medical examinations upon their recruitment and periodically during their working process. The periodical health checkups aim to monitor the laborers� health status, detect occupational diseases and to ensure that the laborers have good health suitable to their jobs.

Article 13.- Hazardous substances

The operators shall have to determine and tightly control all hazardous substances used, stored, produced or treated at the work places, and at the same time to ensure that those who perform work involving hazardous matters must be trained in skills to work with such hazardous matters.

Article 14.- Professional skills and training of laborers

The operators must ensure to employ only persons fully qualified for their assigned jobs. They shall have also to determine the laborers� professional skills and experiences required for the jobs of importance in term of safety. The training must be carried out when necessary and tightly controlled.

Article 15.- Applicable standards

While carrying out petroleum activities, the operators shall have to apply current Vietnamese standards or other standards approved by competent bodies or authorized agencies.

Chapter III

DESIGNING AND BUILDING REQUIREMENTS

Article 16.- General requirements

All projects must be designed, built, equipped and installed in a way to ensure their safe operations and stand the projected loading capacity in the process of operation as well as the loading capacity when accidents occur.

All projects must be designed in a way to ensure that no single trouble shall lead to a chain incident.

The above-said requirements shall also apply to mobile platforms or floating facilities.

Article 17.- Project designing

Before selecting project designing options, the operators shall have to map out the overall idea on the operation and maintenance of the project throughout the its life, and to analyze risks, thus creating grounds for the selection of designing option for the arrangement and selection of components and whole of the project.

In designing, the standards to be applied to the project construction must be determined; studies on working environment should be carried out in order to optimize the working environment conditions during the operation process.

These above requirements shall also apply to mobile platforms or floating facilities.

Article 18.- The project location

All projects must be arranged in safe distances from other construction works, including beacons, maritime signals, cables, pipeline systems.

All projects must be marked with necessary signals such as light, sound, colors so that they can be easily identified from other traffic means during night time or in bad weather conditions.

Article 19.- Danger zones

Projects must be classified and divided into various zones according to risk levels.

The most important functional section, the "Central Control Room", must be arranged outside the regions classified as danger zone.

Dwelling houses on marine projects must be protected and isolated from oil and gas drilling, exploitation and treatment areas.

Article 20.- Technological safety protection system

The oil and gas exploitation, treatment and/or processing systems, including pipeline system, must be equipped with safety system and emergency stop system. The safety system must be capable of detecting incidents or abnormal working status, and capable of preventing and minimizing damage that may happen.

The determination of the location of emergency valves must be based on the risk evaluation. The emergency valves should be arranged in a way to minimize the leakage consequences that may happen.

Article 21.- Emergency exit

All projects must be built with emergency exits and fully equipped with rescue means in order to ensure safe evacuation of people.

Article 22.- Fire prevention and fighting system

All projects must be designed in a way to minimize the possibility of fires and explosion as well as their consequences, and must be equipped with fire and smoke - detecting systems as well as with proper fire-fighting system.

Article 23.- Project construction

All projects must be built according to the approved designs. Any changes in the approved designs must be accepted by competent bodies.

The manufacture, assembly and installation of key components of projects must be expertised by independent organizations. The expertise must be conducted to a necessary extent so as to be able to confirm their compatibility with the provisions of this Regulation and the approved standards. The project certificates granted by the expertising organizations may be used as documents evidencing the project quality.

Article 24.- Test-running and putting projects into operation

Before test-running projects, the operators shall have to proceed with necessary examinations and tests of project items and ensure that their contingency plans have been already in place.

During the test-run, the operators shall have to apply measures in order to be ready to promptly and effectively cope with any incidents which may occur.

Projects shall be put into operation only after they have been confirmed as having met the set requirements.

Chapter IV

PROJECT OPERATING REQUIREMENTS

Article 25.- General requirements

The operators shall have to elaborate and keep up necessary regulations so as to carry out petroleum activities in a safe manner.

All such regulations must be strictly observed and considered, amended and/or supplemented in time or when there is any change in the operating conditions.

Article 26.- Operation management and project maintenance

Before starting the operation of projects, processes necessary for the safe operation and maintenance of the projects must be prepared and disseminated to the laborers and kept at the projects.

Necessary inspections and tests of projects must be conducted periodically in order to check the satisfaction of safety requirements.

The operators shall have to promptly repair and replace damaged equipment at the projects if such equipment cause unsafety to people, projects or environment.

The operators shall have to immediately stop all activities if their continuity will endanger human beings, projects and environment.

Article 27.- Information and communication system

Projects must be equipped with necessary means for internal and external communications, for communications with the mainland, vessels and airplanes at any time.

Article 28.- Hazardous materials

Organizations and individuals that conduct petroleum activities shall have to minimize the use of hazardous materials.

The preservation, transportation and use of hazardous materials shall be effected rationally and safely and in compliance with relevant requirements, regulations and criteria by persons well trained in this field.

The location and time for conducting seismological activities on mainland or coastal areas must be notified to the public and competent bodies before their commencement.

Article 29.- Drilling and drilled well-related work

Before conducting the drilling and/or activities at drilled wells, the instructions on such activities must be available. Such instructions must cover all important aspects of the safety, including processes, organizational matters, responsibility assignment.

Technical properties of all equipment in service of the wells operation and maintenance must be indicated in the operation and maintenance processes and accompanied with parameters on the working capacity limits of such equipment.

The drilling activities and the operation of drilled wells must always be conducted in a safe manner and in accordance with the required processes. Measures must be taken to prevent overflows with substances flowing out of wells.

Article 30.- Closing and abandoning wells

When drilled wells are not used, well-closing measures must be applied to avoid gas and liquid inter-flows between areas in the wells or flows through well mouths. A drilled well shall be abandoned only after at least two blocking valves are placed and these valves have been quality-tested.

When a drilled well is temporarily closed from use, the well-closing must be made in a way that equipment may be re-installed perfectly in term of both the technical requirements and the safety.

The well heads must be protected so as not to be affected by or not to affect marine navigation, fishing or other activities and to ensure the well�s wholeness.

When a well is closed permanently, all equipment rising above the sea bed or land surface must be cut at least three meters thereunder and such part must be recovered. It is prohibited to use the method of cutting the casings with explosive in order to recover the well heads.

Where the mechanical methods have been tried many times but still failed to cut the casings, the competent bodies may consider and permit the use of cutting method with special-use explosive.

Article 31.- Project modification and transformation

Before conducting a project modification and transformation, risks and working environment must be evaluated in order to select the modification and transformation options. The project modification and transformation must not reduce the safety level and working environment requirements.

Article 32.- Diving and undersea activities

Organizations and individuals that conduct petroleum activities shall have to ensure that diving activities are carried out safely by persons who have been properly trained therein.

Before conducting undersea activities, the operators shall have to prepare plans, clearly describing the process of performing the activities, the equipment to be used and safety measures to be applied.

During the course of diving activities, the rescue and first-aid work must be always in the stand-by position.

Article 33.- Cargo and personnel transportation

Organizations and individuals that conduct petroleum activities shall have to provide necessary and safe means for the transportation of personnel and cargo.

Goods, equipment, raw materials and materials transported to and from projects and vessels must be clearly marked for distinction between types of goods, equipment, raw materials and materials, with the names of consignors and consignees as well as destination being distinctly inscribed.

Baskets are not allowed to be used for transport of personnel in bad weather conditions.

If goods are miscarried or gone astray in the course of transportation, competent bodies must be notified thereof. The operators shall have to find and recover the miscarried or astray goods if such goods threaten other activities or cause environmental pollution.

The operators shall have to set weather condition norms for safe handling of goods.

Article 34.- Work - licensing system

The operators shall have to establish and follow the system of licensing performance of work, ensuring that dangerous work shall be performed by authorized persons, and that appropriate measures shall be applied and constant supervision be made so as to avoid accidents.

Before the performance of any work which requires preventive measures and particular safety, the operators shall have to ensure the granting of occupational safety license. Such types of work include the ignition work, travel into or out of danger areas, jobs at places where performers may fall into the sea and other dangerous work.

Before performing dangerous and complicated jobs not yet mentioned in the common operation processes, the operators shall have to analyze the degree of danger for such jobs and apply appropriate safety measures.

Article 35.- Rescue readiness

The operators shall have to establish and maintain the emergency rescue system so that necessary rescue measures shall be effectively applied when accidents or incidents occur, causing damage to people, environment or property, and at the same time notify the competent bodies thereof.

The risk evaluation results shall be used as the input data for organizing the emergency rescue work.

Article 36.- Emergency rescue training and practice

The emergency rescue training and practice at projects must be carried out regularly. The risk evaluation results shall serve as basis for determining type of rescue training and practice as well as its frequency. The training and practice results must be recorded and evaluated in order to complete the emergency rescue plans. Competent bodies may join in such practices.

The new arrivals at projects must be guided in detail in organization of rescue, equipment and facilities and emergency exits.

Article 37.- Stand-by ship

Based on the risk evaluation results, the competent bodies shall prescribe the latest rescue time permitted. The competent bodies may request stand-by ship for sea projects and floating facilities where people work so as to rescue people in cases of emergency, to join in fire-fighting, prevent collision and to protect safety zones and other safety purposes.

The operators may agree to share the use of stand-by ship at the request of competent bodies.

Article 38.- Safety zones and corridors

The safety zones around projects must be established and protected by necessary measures.

The safety zone distance for offshore drilling and/or exploitation projects shall be 500 m from the outer edge of the projects to all directions for fixed projects or from the anchoring point for mobile projects.

For inland projects, including gas processing plants, oil refineries, petro-chemical factories, depots, pipelines and their accompanied constructions, the scope of safety zone shall be considered and determined by competent bodies.

Except for special cases prescribed by the State bodies managing the petroleum activities, unauthorized persons are not allowed to enter and operate in the safety zones.

Within two nautical miles from the outer edge of the sea projects and from two sides of the pipelines, no means and vessel are allowed to anchor.

Article 39.- Project dismantling plans

Before dismantling a project, the operators shall, within six months, have to submit to the competent bodies a project-dismantling plan, stating clearly the dismantling time and method, cleaning work and place for gathering and storing recovered materials.

Chapter V

DOSSIERS MANAGEMENT AND REPORTING REGIME

Article 40.- General requirements

The operators shall have to compile and keep documents and submit reports as required by this Regulation.

Article 41.- Recording incidents, accidents

The operators shall have to establish a system of recording, investigating, evaluating and overcoming accidents, incidents, human or material losses. On the basis of investigation and analysis, the cause(s) of accidents and/or incidents must be determined and overcoming and preventive measures must be adopted in order to avoid similar occurrences.

Article 42.- Reporting on serious accidents and emergencies

The operators shall have to immediately report to Vietnam Petroleum Corporation and the concerned competent bodies, including competent bodies in the localities where activities have been carried out, on the serious accidents and/or emergencies. Such reports must describe the status quo and rescue measures taken and to be taken.

Article 43.- Periodical reporting on safety work

Within the last 15 days of every quarter and year, the operators shall have to submit to the competent bodies and the Vietnam Petroleum Corporation quarterly and yearly reports on the implementation of their approved safety control programs as well as on accidents and/or incidents, if any. Such reports must evaluate the efficiency of the safety control work and preventive measures to avoid similar incidents and/or accidents.

Chapter VI

STATE MANAGEMENT AND INSPECTION OVER SAFETY

Article 44.- Bodies performing State management over petroleum

Bodies performing the State management over petroleum shall coordinate with concerned competent bodies in performing the function of State management and inspection over the safety in petroleum activities. The bodies performing the State management over petroleum shall consider, approve or accept documents submitted according to the requirement of this Regulation.

Article 45.- Concerned competent bodies

The concerned competent bodies with the responsibilities and rights prescribed in Article 44 of this Regulation shall include:

1. The Ministry of Labor, War Invalids and Social Affairs and Health Ministry as prescribed in the Labor Code.

2. The Ministry of Public Security as prescribed in the Ordinance on Fire Prevention and Fighting.

3. The Ministry of Science, Technology and Environment as prescribed in the Law on Environmental Protection and the Ordinance on Radiation Safety and Control.

Other ministries and State bodies shall perform the function of State management over safety according to their respective tasks and powers.

Article 46.- The Vietnam Petroleum Corporation

According to the provisions of Article 191 of the Labor Code of June 23, 1994 and Article 37 of Decree No. 84/CP of December 17, 1996, the Vietnam Petroleum Corporation shall inspect and supervise the petroleum activities of the operators with a view to ensure the observance of this Regulation; consider and evaluate documents as prescribed in Article 4 of this Regulation before they are submitted to competent bodies.

Article 47.- Inspection conditions and contents

The petroleum safety inspection is a specialized inspection as prescribed in Chapter VII of the Petroleum Law, which aims to ensure the observance of this Regulation. The bodies performing the State management over petroleum shall perform the function of safety inspection and issue the inspection decisions. The inspection decisions shall be notified to the inspection objects, clearly stating the inspection contents and the inspection team�s composition.

The inspection team shall have the following obligations and rights:

1. To be entitled to visit projects where organizations and individuals have conducted petroleum activities, and to projects where other employers have conducted activities for safety inspection.

2. To investigate serious accidents.

3. To examine dossiers, documents, books.

4. To check components, equipment of petroleum projects.

5. To request the supply of kept files, including files recorded in computers, floppy disks, compaq disks, books, diagrams, audio tapes, video tapes or other documents concerning safety and health. The inspection team may check, photocopy documents on spot or temporarily bring them for photocopy in other places.

6. To inspect, seize or take samples of, materials, products, tools, equipment or hazardous substances being manufactured, used or found at projects.

7. To check, take photos of, to film, to tape or duplicate information kept in computers or disks.

8. To interview and obtain comments from laborers.

9. When conducting the investigation, the investigation team shall have to abide by provisions of law and shall not obstruct petroleum activities illegally.

Article 48.- The right to issue decisions

The inspection team shall be entitled to determine violations and adopt implementation measures, which must be made in writing with the prescription of implementation time limit. These documents shall be addressed to responsible organizations and individuals. Where because of urgent safety demand, such documents shall be forwarded directly to responsible persons at the inspected projects.

Article 49.- Suspension of operation

The inspection team may decide the temporary suspension of the whole or part of the operation if serious violation(s) or repeated violations of the provisions of this Regulation are detected. The inspection team shall have to immediately report to the competent bodies on such temporary suspension. The competent bodies shall issue handling decisions.

Article 50.- Responsibility to assist inspectors

The operators shall have to assist and create favorable conditions for the inspection team to perform its functions prescribed in Article 47 of this Regulation. The operators shall have to arrange accommodation and dining places for the team as well as means for its travel to and from the projects, when necessary.

Article 51.- Executing inspection decision

The operators shall have to execute decisions of the inspection team. They may complain with competent bodies about such decisions according to the provisions of law.

Chapter VII

COMMENDATION AND VIOLATION HANDLING

Article 52.- Commendation

Organizations and individuals that have recorded achievements in the safety work or made great contributions to the emergency rescue and the minimization of damage caused to people, environment and property by accidents or natural calamities shall be commended according to the regulations of the Socialist Republic of Vietnam.

Article 53.- Violations

Organizations and individuals shall be considered violators of this Regulation if committing the following acts:

1. Delaying the implementation of the provisions of this Regulation, as well as decisions, directives and requirements of the competent bodies or the provisions and conditions approved by the competent bodies;

2. Making by themselves or jointly with others the third party to commit violations or fail to comply with the provisions of Item 1, this Article.

Article 54.- Handling of violations

Organizations and individuals that violate the provisions of this Regulation shall be handled according to Article 43 of the Petroleum Law of July 6, 1993 and Chapter IX of Decree No. 84/CP of December 17, 1996.

Chapter VIII

IMPLEMENTATION PROVISIONS

Article 55.- Guiding the implementation of the Regulation

The Vietnam Petroleum Corporation shall, within the scope of its functions and powers, have to guide the implementation of this Regulation.

Article 56.- Effect

This Regulation takes effect 15 days after its signing. All previous stipulations contrary to this Regulation shall all be annulled.

For the Prime Minister

Deputy Prime Minister
NGO XUAN LOC